Strickland weighs in on new lawsuit Elvis Presley Enterprises filed against Memphis

Crews worked to transform the grounds around the mansion at Graceland into a winter wonderland for the filming of the Hallmark Channel’s new movie, “Christmas at Graceland,” on July 19. Elvis Presley Enterprises filed another lawsuit against the city of Memphis this week as it pursues approval of its expansion plans.(Photo: Brad Vest/The Commercial Appeal)Buy Photo

Elvis Presley Enterprises filed another lawsuit against the city of Memphis this week, arguing a delay in the approval process for Graceland expansion plans is retaliatory and unlawful.

“That’s not the first time Graceland has sued us, that’s I think the third time that’s happened,” Mayor Jim Strickland said Thursday. “Bottom line: The private owners of Graceland want public taxpayer dollars to put into their privately-owned facilities. And we have a problem with that.”

The new lawsuit, filed Tuesday in U.S. District Court, alleges a delay earlier this month in the Land Use Control Board’s consideration of a major Graceland expansion plan was meant to punish Graceland.

A 6,200-seat arena is among the expansion plans, which Memphis city officials have said they believe would violate a non-compete agreement with the FedExForum.

The Economic Development Growth Engine of Memphis and Shelby County voted earlier this year in favor of the Graceland expansion project, provided it doesn’t violate the non-compete agreement. The Shelby County Commission in June gave its blessing to the expansion plans with the condition that a judge settles the dispute over the non-compete agreement.

But action by the Land Use Control Board is being deferred until pending litigation in Chancery Court is resolved.

Elvis Presley Enterprises is seeking an increase to the percentage of tax increment financing it receives to help pay for the next phase of the expansion project. The Memphis Grizzlies lease agreement for the FedExForum states that city funding can’t be used for a new venue that seats more than 5,000 people and would compete with the Downtown Memphis facility.

The new lawsuit contends that the city, specifically Chief Legal Officer Bruce McMullen, took “unlawful and retaliatory” action, blocking the Memphis-Shelby County Office of Planning and Development from approving Graceland’s development application, in response to the Graceland stance on the arena agreement, and the fact that it obtained resolutions from EDGE and the county “over the city’s objections.”

"Simply put, (Elvis Presley Enterprises) proceeded with the non-arena aspects of the project because it had an unfettered right to do so, and there was nothing prohibiting it from proceeding with that portion of the project," the lawsuit states.

The allegations "appear to claim" the city shouldn't be allowed to communicate with the Office of Planning Development about the state court lawsuit, despite the fact that the office is a joint city-county operation, McMullen said in a statement, also noting that EDGE's approval of funneling taxpayer dollars to the Graceland expansion is contingent on a court ruling that it wouldn't breach the FedExForum non-compete agreement.

That resolution would grow to 65 percent the share of funds Graceland draws from its tax increment financing district, which earmarks property tax revenue from assessed value increases within the district.

McMullen in a statement called the new lawsuit largely a “rehash” of the allegations raised in a separate lawsuit in state court, which the city has filed a motion to dismiss.

“It is hard to see how the lawsuit is legally sound,” McMullen said in the statement. “Unfortunately, once again it appears EPE is using lawsuits as part of their business strategy.”

Jamie Munks covers Memphis city government and politics for The Commercial Appeal. She can be reached at 901-529-2536, jamie.munks@commercialappeal.com or on Twitter @journo_jamie_.